Method and system for creating and tracking life insurance policies in separate accounts including modified stable value protected funds

ABSTRACT

A system and method for administering an insurance policy in general accounts and in separate accounts including a modified stable value protected investment including an improved surrender payment protocol. The system and method includes tracking the value of investments and an MSVP value in a life insurance contract after a termination of life insurance coverage has occurred. When the system determines that the value of the MSVP equals a predetermined value (e.g., zero) or that a maturity date for the policy or stable value protected investment has occurred, the system causes an amount equal to the value of the MSVP division to be paid to the contractholder. Upon such payment, the MSVP product provider shall have no further liability under the MSVP. The contractholder may have an option to elect at any time to receive a payment amount equal to the value of the underlying assets of the stable value protected investment. In such event, the MSVP product provider shall have no further liability under the MSVP.

CROSS REFERENCE TO CO-PENDING APPLICATION

This application is a continuation of U.S. application Ser. No.17/466,570, filed Sep. 3, 2021, which is a continuation of U.S.application Ser. No. 13/862,251, filed Apr. 12, 2013, which claimspriority under 35 U.S.C. 1 19(e) to U.S. Application No. 61/623,389,filed Apr. 12, 2012; the entire contents of those applications areincorporated herein by reference.

FIELD OF THE INVENTION

The present invention is directed to an automated system for tracking,reconciling and administering the values of improved life insurancepolicies in general accounts and in separate accounts including StableValue Protected funds, and in one embodiment, to life insurance policiesincluding an improved surrender payment protocol.

DISCUSSION OF THE BACKGROUND

Known life insurance policies in separate accounts including StableValue Protected funds have two separately tracked values: “book value”and “market value.”

The premiums paid under life insurance policies in separate accountsincluding Stable Value Protected funds may be invested in certainvariable investment options (a “Separate Account”). A Separate Accountis a segregated investment account established to separate the assetsfunding the Policy from the other assets of the insurance company,although the insurance company is considered the owner of the assets ofthe Separate Account. The Separate Account is further segmented into“Divisions.” The net premiums are applied to the Separate Account andallocated to one or more of the existing Divisions based on thedecisions of the contractholder.

The policy is considered “variable” since the accumulation value of thepolicy (and if applicable, each certificate issued under the policy) isnot guaranteed, but rather, varies based on the investment experience ofthe Division. The death benefit is equal to a stated amount (or thevariable insurance amount), made up in part of the value of the SeparateAccount and in part from the insurance company's general assets.

Certain Divisions offer a Stable Value Protected (or Protection) product(generically referred to as the “SVP Product” but such reference is notlimited to any specific embodiment), which is designed to smoothfluctuations in the value of the underlying investments of a Division(generically referred to as the “SVP Division” but such reference is notlimited to any specific embodiment). SVP Divisions may be portfoliosthat purchase an SVP Product from an SVP Writer. Separate SVPSub-Divisions are established for each contractholder that allocatespolicy values to the SVP Division. At least one known SVP Productprovides, among other things, that if the market value of the Division(“market value”) is less than the book value of the Division (“bookvalue”), the SVP Writer will make up the difference (genericallyreferred to as the “SVP Value” but such reference is not limited to anyspecific embodiment) in the event the policy is surrendered.

The book value of the SVP Sub-Division will grow at a crediting ratewhich is reset periodically (e.g., quarterly). Changes in book value maybe accounted for and/or tracked on a periodic basis (e.g., daily,weekly, monthly, or quarterly) and the rate at which the book valuechanges may also be reset periodically (e.g., at the same time or at adifferent time than the changes in book value are accounted for). Themarket value of the Division, however, is a value of the underlyinginvestments (not including the SVP Product) that have been made in theportfolio. The crediting rate reset process is designed, among otherthings, to amortize or reduce the SVP Value over time. One way toamortize or reduce a positive SVP value is to set the crediting ratelower than the anticipated growth of the underlying investments.

As the value of the SVP Product grows an SVP Writer may be concernedabout (i) the magnitude of its exposure and (ii) the possibility thatthe contractholder may surrender the policy if the crediting rate isreduced, especially when it is reduced to zero (at which point the bookvalue will remain the same and the policy will become a non-incomeproducing asset).

SUMMARY OF THE INVENTION

As described herein, a computer system administers an investment, wherethe computer system includes at least one computer processor and atleast one memory for storing computer executable instructions. When thecomputer executable instructions are executed by the at least onecomputer processor, the computer system performs the following: trackingan investment value of at least one stable value protected investmentutilizing a surrender payment protocol option; tracking an asset valueof at least one underlying asset associated with the at least one stablevalue protected investment; receiving a termination indication that acontract holder of a life insurance contract including the at least onestable value protected investment has requested termination of the lifeinsurance contract; determining a difference representing an extent towhich the investment value exceeds the asset value; and providing apayment indication that the contract holder be paid an amount based onthe investment value when the difference is at most a firstpredetermined threshold value.

According to one aspect, the computer system provides the paymentindication if the difference is at most the first predeterminedthreshold value in a first timeframe. According to a second aspect, thecomputer system provides the payment indication in a second timeframe ifthe difference is more than the first predetermined threshold value inthe first timeframe.

Upon termination of the insurance contract, the computer system canrequest liquidation of the at least one underlying asset associated withthe at least one stable value protected investment and/or request anestimate of the investment value corresponding to the at least oneunderlying asset associated with the at least one stable value protectedinvestment.

BRIEF DESCRIPTION OF THE DRAWINGS

The following description, given with respect to the attached drawings,may be better understood with reference to the non-limiting examples ofthe drawings, wherein:

FIG. 1 is an illustration of an exemplary computer system acting as anadministration system for the investments described herein;

FIG. 2 is a flowchart showing administrative processing steps during aperiod of normal operations;

FIG. 3 is a flowchart showing administrative processing steps during anoperational MSVP Period;

FIG. 4 is an illustration of communications between various exemplaryparties during processing by an exemplary administrative system; and

FIG. 5 is a flowchart showing exemplary processing steps for processinga termination notice for a life insurance policy including at least onestable value protected investment using a surrender payment protocoloption.

DETAILED DESCRIPTION OF THE INVENTION

An improved surrender payment protocol (generically referred to hereinas “ISPP” but such reference is not limited to any specific embodiment)may be utilized in connection with an SVP Product to reduce the exposureof the SVP product provider (herein also referred to as an SVP Writer)and to provide increased flexibility under the policy to thecontractholder that allocates policy assets to an SVP Sub-Division.

An improved surrender payment protocol may also be used in connectionwith a policy in which assets are allocated to the general account ofthe insurance company.

An ISPP may be implemented after a surrender of a policy has occurred toreduce the value of an SVP prior to the time for payment, which may be“n” years (or months or days) after the effective date of the surrender,thereby creating a modified SVP (generically referred to as “MSVP” or“MSVP Poduct” but such reference is not limited to any specificembodiment). An administrative system may be used that tracks andmanages the process and/or an MSVP.

Embodiments of the invention include a computer system with speciallyprogrammed software to track information and manage the MSVP Divisionsor Sub-Divisions described herein. Such a system may also generatereports for the different parties (e.g., contractholders, insurancecompany, investment managers, MSVP writers, etc.) and/or tax reports.Such a system may cause alerts to be sent to various parties upon theoccurrence of certain events (e.g., an MSVP equals, exceeds or is lessthan a predetermined value, the crossing above or below a threshold thatis tracked, the change in age of a group of insureds). The system mayalso determine and/or track a maturity date for an MSVP Sub-Division.

An exemplary embodiment of such an administrative computer system isillustrated in FIG. 1 . Within a computer 102, there are provided: acentral processing unit for a memory subsystem 106, a communicationscard 108 (e.g., an Ethernet card or a fax/modem card), a digital storage(e.g. a hard disk drive or an array of hard disk drives) 112, a lowdensity removable medium storage (e.g., a floppy disk drive or USB flashdrive) 114 and a high density removable medium storage (e.g., compactdisc drive, a DVD drive, a Blu-ray drive or tape drive) 116.Furthermore, keyboard 118 and monitor 120 are connected to the computersystem 102 for inputting and outputting data, respectively. Anadditional printer 122 for printing reports 124 is also provided.

The computer system 102 has a central processing unit 104 which cancomprise any one of the commercially available central processing units(e.g., Intel Xeon, Core, Pentium or 80x86 family of processors, Motorola680x0 family of processors, Power PC processors, etc.) to direct andcoordinate the activities of the other components. The memory subsystem106 comprises a combination of read only memory (ROM) and random accessmemory (RAM), and the memory's subsystem 106 stores commands to beexecuted by the central processing unit 104.

Together the central processing unit 104 and memory subsystem 106control the other devices of the system. A communications card 108, suchas a network interface card, connects to a wide area network such as theInternet, using wired or wireless communications and using any number ofdata transfer protocols (e.g., HTTP, HTTPS, FTP, SMTP) to transferinformation between the computer system and entities such as investmentmanagers, insurance and annuity companies, SVP product providers andcontractholders. Such data may be displayed by a web browser thatconnects to a web server on the computer 102. In an alternate embodimentthe web server is run on a second computer system 102 and exchangesinformation with the first computer system102. The communications card 108 additionally is used to sendconfirmations to such entities. The communications card 108 sends andreceives information by using an installed program which runs on thecomputer system 102. The program in an alternate embodiment is run on asecond computer system 102 and exchanges information with the firstcomputer system 102. In another embodiment, multiple communicationscards (e.g., Ethernet, fax/modems, fax-boards or modems) are installedin the computer system 102 to provide connections to multiple entitiessimultaneously. Alternatively, a fax/modem, connects to a telephone line(not shown) to transfer information. The system is additionally used tocontact outside information providers and asset managers.

The system 102 may also utilize various databases on the digital storage112. Such a database may be used by any of the applications on thesystem 102 that retrieve information from or store information into thevarious databases. Such information may include investment values andvalues of underlying assets as described in greater detail herein. Thedatabase in an alternate embodiment is run on a second computer system102 and exchanges information with the first computer system 102.

Digital storage 112 also is used to store both programs (e.g., operatingsystems and user applications) and a database 113. The programs areloaded from the digital storage 112 into at least one memory subsystem106, and they are then executed by at least one CPU 104. The database113 of information describes the assets, investments, census, mortalitytables, and other policy-related data and investments being managed bythe systems described herein. Currently available commercial databasessuch as DB 2/2 for OS/2, Microsoft Access for Windows, Microsoft SQLServer, and Oracle's SQL server are suitable for storing asset andinvestment information. In addition, open source databases, such asMySQL, could be utilized. Additional programs and information can bewritten to the digital storage 112 having been read from the low densityremovable medium storage 114 and high density removable medium storage(e.g., compact-disc) 116 or having been transmitted the computer system102 via the communications card 108. The system further includes acomputer readable media (e.g., high density removable storage 116) forcontrolling a computer to manage an administration and tracking system.A keyboard 118 additionally is used for entering data into the computersystems, and a computer monitor 120 is used to display both graphicaland textual information from the computer systems. A printer 122 printsreports. The above-described computer can be either a physical computeror a virtual computer running in a virtual machine emulator such asVMWare.

The administration of an MSVP Sub-Division Division during normaloperations is characterized by the steps of FIG. 2 . The exact order ofsteps is not intended to be limiting as long as data needed by one stepis received and/or calculated before it is needed in a subsequent step.The steps may additionally be performed in parallel where they areindependent. In step 210, the system can track allocations. (As usedherein, “tracking” may include any or all of, importing data, recordingcalculation parameters, performing calculations, recording calculationsand storing results, e.g., into a database.) Generally, allocations intothe MSVP Sub-Division will increase both the book and market values of aMSVP Sub-Division. The amount of the increase to book and market valuesmay be equal or the increases to book value may be greater than theincreases to market value as occurs in known SVP Divisions. The systemcan record allocations into a MSVP Division and applicable MSVPSub-Division. Allocations can be sourced from new funds entering thecontract or from funds previously held in other investment options orreserves. New funds entering the contract can be a result of premiumpayments (possibly funded by death benefit reinvestments) and could alsoresult from expense credits.

The system can gather information regarding allocation source,allocation amounts, and allocation date and apply these values to thepolicy's Division values. The system can also identify and calculate alldeductions that are required for the form of allocation involved. Forexample, receipt of premium requires the calculation and application ofstate premium taxes, DAC taxes, agent commission charges and/or othercharges contractually required. The system can communicate theallocation amounts to the investment manager for action and reconcileswith the investment manager after the amounts have been transferred tothe Division.

In step 220, the system can track a crediting rate for each MSVPSub-Division. A MSVP Sub-Division crediting rate is calculated andrecorded on the system along with the period of time that the rate is ineffect. Using the MSVP Sub-Division crediting rate the system cancalculate/determine the MSVP Sub-Division book value. The system canalso record and track the market value of the MSVP Division andapplicable MSVP Sub-Division.

In step 230, the system can calculate fees and assessments related tothe MSVP Sub-Division. Deductions from the Sub-Division includeasset-based charges and insurance-based assessments. Other types of feesand assessments may also be calculated and processed. Asset-basedcharges may include fees such as account management, investmentmanagement, Mortality and Expense Risk charge (M&E), SVP fees and MSVPfees. Insurance-based assessments include fees such as mortalityretention charges and Cost of Insurance (COi) assessments (which in thecase of experience-rated contracts are transferred to the MortalityReserve). The system applies the deductions to the Sub-Division's bookand market values and communicates these amounts to the investmentmanager and insurance company or its agent for redemption action.Calculated fees and assessments are communicated to the insurancecompany or its agent for appropriate distribution of fees and COiassessments.

In step 240, the system can respond to death claims recorded against thepolicy. When a death claim is processed, all assets attributable to theinsured's certificate are liquidated at book value. The underlyingmarket fund is reduced by the book value of the insured's certificateand the MSVP % value increases.

In step 250, the system can track the value of the Mortality Reserve inthe case of experience-rated contracts. This includes tracking thecurrent Mortality Reserve crediting rate, the target reserve and thecurrent balance. The insurance company periodically directs refunds fromthe Mortality Reserve to the investment divisions which the system willrecord as allocations described above.

In step 260, the system can record and/or track information such as (1)MSVP percentage threshold, (2) MSVP dollar threshold, (3) MSVPSub-Division book value, (4) MSVP Sub-Division market value, (5) MSVPpercentage, (6) MSVP dollar amount, (7) book value/market valuerelationships, (8) death benefits, (9) death claims recorded against thepolicy, (10) the addition of premiums, (11) premium thresholds, (12)allocations from one Division or Sub-Division to another Division orSub-Division, (13) expense or reserve credits, and (14) other sourcesfor reducing or paying an MSVP value.

The system can, at various times, determine if an ISPP option is ineffect, and, if so, performs the processing described below with respectto the ISPP option.

The system can also record, track and administer any other information,calculations, and/or thresholds determined by the provisions of the MSVPDivision or Sub-Division or the MSVP Writer.

As shown in FIG. 3 , the system optionally performs operationsincluding: (1) tracking allocations, (2) tracking directed allocations,(3) tracking voluntary premium payments, (4) tracking COi rate changes,(5) tracking MSVP crediting rate changes, (6) tracking market value.Each of those operations may have one or more of the sub-steps describedbelow.

To implement one version of a MSVP, a new MSVP Division can be createdor an existing SVP can be modified. If a new MSVP Division is created,the new MSVP Division can be made available to all contractholders(minimum investment limits may apply) that own a particular type (e.g.,series) of SVP or MSVP policy. Some SVP or MSVP Divisions orSub-Divisions include restrictions on reallocations by a contractholderfrom one SVP or MSVP Division to another SVP or MSVP Division.

When creating an MSVP from an existing SVP, various steps may need to betaken. For example, a contractholder would reallocate existing bookvalue of at least one SVP Sub-Division to the new MSVP Sub-Division(together with existing SVP Value).

Upon the occurrence of any event or condition that is specified by theterms of the MSVP Division or Sub-Division or by the MSVP (genericallyreferred to as a “Transition Trigger” but such reference is not limitedto any specific embodiment) (exemplary Transition Triggers are describedbelow), the MSVP Writer or the insurance company may have the right totake certain actions, including actions to amortize the value of theMSVP Product. These actions may include reallocating all of a portion ofan MSVP Sub-Division to a low risk or low volatility investment (e.g., amoney market or short term government bond Division), resetting thecrediting rate (to not less than 0% or 0.1%), and/or changing theamortization period (which may be subject to a maximum period of years).For certain Transition Triggers, the contractholder may also have theright to take certain actions, e.g., reallocate all or a portion of anMSVP Sub-Division to a low risk or low volatility investment (e.g., amoney market or short term government bond Division).

An example of a crediting rate reset process is as follows:

-   -   Annual crediting rate=estimated yield[s] of underlying assets of        the Division minus SVP amortization adjustment.

The SVP amortization adjustment equals (SVP Value divided by InvestmentValue) divided by an amortization period (e.g. 5 years). Theamortization period may vary depending on the value of the calculationSVP Value divided by Investment Value (book value). For example as thevalue of the calculation SVP Value divided by Investment Value increasesthe amortization period may decrease. The crediting rate may also besubject to maximum reductions for the reset period and/or second period.

The system can determine when the MSVP Sub-Division reaches maturity.The maturity may be required to occur in the event that the MSVP valueis equal to or less than a value of some MSVP threshold. Examples ofevents that would require maturity to occur include, but are not limitedto (1) a specified period of time; (2) a specified amount of deathbenefits have been paid; or (3) market value is equal to or greater thana threshold amount. Maturity may occur during the period after thecontractholder has surrendered the policy.

As described above, the MSVP Sub-Division may include provisionsdefining certain “Transition Triggers.” Examples of such “TransitionTriggers” include, but are not limited to: (a) the book value of theMSVP Sub-Division falls below a specified amount, (b) the value of anMSVP Product for an MSVP Sub-Division equals or exceeds a specifiedpercentage, (c) the average attained age of the Insureds under thePolicy, weighted by each Certificate's Variable Insurance Amount or faceamount, is greater than a specified age, (d) an Investment Adviserceases for any reason to act as an investment manager for a non-SVPDivision in which an MSVP Sub-Division invests, unless the insurancecompany appoints another investment manager for the non-SVP Division andthe MSVP Writer consents in writing not to treat the change ofinvestment managers as a Transition Trigger, and (e) a measurementdesigned to track whether yields are increasing for the assets of aDivision (e.g., the trailing “n” quarter average yield of the assets ofthe Proceeds Division (or an index) shows an increase in yields (where“n” is between 1 and 40 quarters, but preferably 20 quarters).

In order to provide, manage, track and report on MSVPs and MSVPSub-Divisions, a specially programmed computer system (e.g., computer102) is preferably utilized that eases management. Such a computersystem may provide creation of an MSVP Sub-Division and monitoring of acreated MSVP Sub-Division. In order to create an MSVP Sub-Division, thesystem may be initialized with information such that an MSVPSub-Division is an available investment division, by product, and/or bypolicy. The system can configure division properties as any other SVPdivision (e.g., by specifying Name, Investment Manager, Fee Structure,crediting rate process).

As not all MSVP Sub-Divisions may utilize the same set of optionsresulting from a Transition Trigger, the system may include availableMSVP Sub-Division options and their configuration parameters. Forexample, election options available to the MSVP Writer may include, butare not limited to: (1) transfer market value to Money Market or otherlow risk investment option and (2) reset the crediting rate.

The system may also be configured to track/specify properties specificto MSVP Sub-Divisions, including, but not limited to: (1) the primarySVP or MSVP Writer (and what, if anything, its corresponding primaryliability limit is (e.g. 15% of book value), (2) whether a secondary SVPor MSVP writer exists, and if so, who it is and what, if any, liabilitylimit it has, (3) what Transition Triggers exist for each MSVP divisionunder the contract and what their configurations should be. (Thus, anMSVP Writer may have primary liability for any MSVP value or may besecondary to at least one other MSVP Writer.)

As described above, the system may also coordinate communication withthe various parties. As participants in the MSVP change and/or areadded, the system tracks those changes (e.g., by tracking the MSVPWriter and/or the secondary MSVP Writer).

While the above discussion has focused on either a single MSVP Writer oran MSVP Writer and a secondary MSVP writer, alternate groupings of MSVPWriters and SVP Writers can be used. For example, an SVP Writer may actas the primary SVP writer for all or a portion of the divisions in alife insurance policy while an MSVP Writer acts as the “secondary.” Insuch a configuration, the primary SVP Writer and the secondary MSVPWriter would be obligated for their respective portions of the SVP/MSVPvalue. Similarly, an MSVP Writer could act as the primary and an SVPWriter could act as the secondary. Furthermore, more than two levels ofSVP/MSVP Writers can be used (e.g., three or four with at least one MSVPWriter), creating a hierarchy of SVP/MSVP Writers.

Also, rather than, or in addition to, utilizing multiple levels in ahierarchy, the MSVP and SVP writers may instead utilize shared riskssuch that multiple Writers exist on the same level of the hierarchy, butfor a fixed percentage of the SVP/MSVP value. For example, an SVP Writerand an MSVP Writer may both be at the first level of the hierarchy andshare (50/50 or 60/40, etc.) the risk of paying off the SVP/MSVP valueup to a fixed threshold (e.g., which could be as great as 100%).

In the embodiments described above where MSVP and SVP Writers are usedtogether, the system as described above may additionally track triggers,thresholds and information related to SVP Divisions and/or Sub-Divisionsin addition to triggers, thresholds and information related to MSVPDivisions and/or Sub-Divisions.

In general, each MSVP is intended to smooth the market value fluctuationof the MSVP Sub-Division's investment in the Corresponding Division(s)over the term of a policy, If a policy is not surrendered, it willgenerally remain in force during the entire life of the Insureds. Theuse of the term “Corresponding Division” generically refers to thedivisions of a separate account established by the life insurancecompany that invest in a portfolio of securities and other instrumentsaccording to the applicable investment objectives and guidelines, butsuch reference is not limited to any specific embodiment. TheCorresponding Divisions may be available for direct allocation ofInvestment Value or through an MSVP Sub-Division. Thus, over thelong-term, the Investment Value of an MSVP Sub-Division will be equal tothe market value of the MSVP Sub-Division's investment in theCorresponding Division, as reduced by all Policy fees and charges,including the MSVP fee. The MSVP is generally not intended to provideprincipal or creditworthiness protection of the investments of theCorresponding Divisions.

In one embodiment, generally, the Investment Value of each MSVPSub-Division equals the Investment Value of each MSVP Sub-Division as ofthe prior Business Day plus increases (A) minus subtractions (B). Theincreases (A) may include (A1) the amount of interest credited, which iscalculated using a daily crediting rate as determined periodically bythe MSVP Writer or insurance company, for each day occurring followingthe last Business Day up to and including the current Business Day;provided that if it is a leap year, February 29th may not count as a day(the “Calculation Period”), and (A2) any allocations to the MSVPSub-Division, including allocations due to premiums, reallocations,Expense Credits and Experience Credits, effective on the currentBusiness Day. The subtractions (B) may include (B1) Policy fees andcharges deducted from the MSVP Sub-Division during the CalculationPeriod, including the fees payable with respect to the MSVP orinvestment advisory fees; and (B2) the Investment Value redeemed fromthe MSVP Sub-Division on the current Business Day due to Policytransactions including the Investment Value of the Certificate of anyInsured for whom a Death Benefit is paid or insurance coverage iscancelled as consented to by the insurance company.

In general, the value of an MSVP is the difference between (i) theInvestment Value of the MSVP Sub-Division and (ii) the Investment Valueof the Corresponding Division held by the MSVP Sub-Division. Under theterms of the MSVP, the Investment Value of each MSVP Sub-Division willgrow at a periodically (e.g., quarterly) resetting crediting rate whichreflects market conditions and amortizes the value of the MSVP to zeroover time. Amortizing the value of the MSVP should reduce over time thedifferences between the Investment Value of the MSVP Sub-Division andthe Investment Value of the Corresponding Division held by the MSVPSub-Division. (The crediting rate for the different time periods mayeither be the same or they may be calculated differently for differenttime periods.)

As described above, crediting rates are used in the administration ofthe investments described above, and those crediting rates can vary overtime and in light of various conditions. Crediting rates can be setbased on a number of factors, including, but not limited to: (1) marketconditions at the time of setting each crediting rate, (2) anticipatedtotal return (including any principal, interest and dividend payments orstock dividends) and duration of the Corresponding Division, (3) theMSVP value, if any, (4) a guaranteed minimum crediting rate (e.g., 0.0%,0.1%) (which applies for all MSVP Sub-Divisions), and (5) a maximumchange in the annualized crediting rate in any quarter.

After the initial crediting rate period, in general, crediting rates canbe reset on all MSVP Sub-Divisions periodically effective on the ResetDate. Crediting rates may not be reset during certain periods (e.g.,when an election is made upon the occurrence of a Transition Trigger(generically referred to as a “Transition Election” but such referenceis not limited to any specific embodiment). In such cases, the MSVPWriter may have the right to immediately reset the crediting rate to afixed rate (e.g., 0.0%, 0.1%) and may have the right to keep thecrediting rate at that fixed rate.

In one embodiment, the following formulas will generally be used, otherthan when an Transition Election has been made, to calculate the annualand daily crediting rates (subject to the minimum crediting rate):

ACR=YTM−SARA, where:

ACR is the annual crediting rate; YTM is selected on each Reset Date bythe MSVP Writer, and is any of the following (i) the yield to maturityof the benchmark of the Corresponding Divisions, (ii) the anticipatedyield of the assets in the Corresponding Divisions, as reported by theInvestment Adviser, (iii) the yield of the assets in the CorrespondingDivisions, as determined by the MSVP Writer based upon current marketconditions or (iv) previous ACR; and SARA is the MSVP Amortization RateAdjustment, which may be positive or negative, computed according to thetable below; however, the maximum impact of SARA on ACR in any quarteris limited as set forth in the following table.

Value of MSVP as a % of Investment Value Up to 7% 7.01% to 10% 10.01%and up SARA MSVP %/5 MSVP %/4 MSVP %/3 Maximum Change in 0.35% 0.60%0.85% ACR in any Quarter

Example 1

If the YTM equals 8.5% and the value of the MSVP equals 5% of theInvestment Value, the ACR for the next quarter would, in general, be:

YTM−SARA=YTM−MSVP %15=8.5%-5%15=7.5%

However, the maximum impact of SARA on ACR is limited in any quarter to0.35% in this example. Thus, if the current ACR equals 9%, then the ACRfor the next quarter would be 9%-0.35% or 8.65%, rather than 7.5%.

Example 2

If the YTM equals 5.5% and the value of the MSVP equals 5% of theInvestment Value, the ACR for the next quarter would, in general, be:

YTM−SARA=YTM−MSVP %15=5.5%−5%/5=4.5%

However, the maximum impact of SARA on ACR is limited in any quarter to0.35% in this example. Thus, if the current ACR equals 4.0%, then theACR for the next quarter would be 4.0%+0.35% or 4.35% rather than 4.5%.

Daily Crediting Rate:

DCR=[(1+ACR){circumflex over ( )}1/365]−1 where:

-   -   DCR=daily crediting rate (expressed as a decimal)    -   ACR=annualized crediting rate (expressed as a decimal).

In an alternative embodiment, “Absolute Value of MSVP as a % ofInvestment Value” may be used in the exemplary table above in place of“Value of MSVP as a % of Investment Value.”

In another embodiment of an MSVP, a contractholder can elect or beprovided an improved surrender payment protocol (generically referred toas “ISPP” but such reference is not limited to any specific embodiment)option when the contractholder terminates the life insurance coveragevia surrender. The contractholder may also elect or be provided an ISPPoption at the time of allocation to any MSVP Sub-Division. The ISPPoperates as described below. The insurance coverage will terminate onthe effective date of the surrender (“Surrender Effective Date”).Accordingly, no Death Benefit is payable for any death occurring on orafter the Surrender Effective Date.

One embodiment of an ISPP option is described in greater detail below.As shown in the exemplary embodiment of FIG. 4 , a contract holder 405,an insurance company 410, an MSVP writer 430, an investment manager 425,a custodian 415, an escrow agent (or trustee) 435 and a pricing provider420 communicate to administer a life insurance policy including stablevalue protected investment and to handle post-termination processing ofthe life insurance policy when the contract holder 405 terminates thelife insurance policy. Contract holder 405 is the entity that has madepremium payments into the separate or general account of the insurancecompany utilizing an MSVP. Insurance company 410 maintains the stablevalue protected investment within the general account or the separateaccount of the insurance company. Custodian 415 provides custodyservices for the underlying assets associated with the at least onestable value protected investment. Pricing provider 420 delivers pricesof the underlying assets associated with the at least one stable valueprotected investment to other entities (e.g., the insurance company 410,the custodian 415, and the investment manager 425). Investment manager425 provides investment management services on the underlying assetsassociated with the at least one stable value investment. MSVP writer430 may be responsible for paying an amount of MSVP value. Escrow agent435 holds an offsetting value in an escrow or trust utilized to offsetthe difference between the investment value of the at least one stablevalue protected investment and the value of the underlying assetsassociated with at least one stable value protected investment. Inalternative embodiments, the roles of plural of the entities describedabove may be combined into a single entity or further split intoadditional entities.

As shown in FIG. 5 , an insurance company receives from thecontractholder a notice of termination of the of life insurance policyincluding at least one stable value protected investment using asurrender payment protocol option. (Step 510.) Following the SurrenderEffective Date, for each MSVP Sub-Division to which Investment Value isallocated, the insurance company will liquidate the MSVP Sub-Division'sinterest in the Corresponding Division (e.g., by notifying an investmentmanager 425). The custodian 415 may then hold the value of theliquidated assets. The insurance company will request the orderlyliquidation of the underlying assets held by the respectiveCorresponding Division within “n” months of the Surrender EffectiveDate. In an alternative embodiment, the insurance company may request anestimate of the liquidation value of the underlying assets held by therespective Corresponding Division.

Following the liquidation (or the estimation) of the interests in therespective Corresponding Divisions, the corresponding investment valuesand asset values are determined. (Step 520). The difference between theinvestment values and asset values (i.e., the value (or estimated value)of all MSVPs) will be determined for all MSVP Sub-Divisions to whichInvestment Value is allocated. If the sum of all MSVPs is equal to orless than a predetermined threshold value (e.g., zero) (step 530), theInvestment Value held in all MSVP Sub-Divisions will be paid within ‘n”months of the Surrender Effective Date and all MSVPs shall terminate onthe Surrender Effective Date. (Step 540.) If the sum of all MSVPs isgreater than a predetermined value (e.g., zero), then the followingprocedures will apply. (Step 550.)

Following the Surrender Effective Date, the Investment Value held in thevarious MSVP Sub-Divisions will be transferred from those MSVPSub-Divisions to one or more Divisions selected by the insurance companyin consultation with the MSVP Writer (generically referred to as a“Proceeds Division” but such reference is not limited to any specificembodiment). In alternative embodiments, the MSVP Writer or thecontractholder will select the one or more Proceeds Divisions or the oneor more Proceeds Divisions may be determined by reference to the one ormore MSVP Sub-Divisions to which policy allocations were made as of theSurrender Effective Date. All MSVPs held by those MSVP Sub-Divisions maybe consolidated into a single MSVP held by one or more ProceedsDivisions. In an alternate embodiment, the Investment Value held in theone or more MSVP Sub-Divisions will remain in the one or more MSVPSub-Divisions as existed as of the date of surrender and will not betransferred from those MSVP Sub-Divisions to a Proceeds Division. Thename of the MSVP Sub-Division may be changed. The procedures describedbelow with respect to Proceeds Divisions would then apply to the variousMSVP Sub-Divisions as existed as of the date of surrender. In analternative embodiment, the assets of the one or more MSVP Sub-Divisionsmay be transferred in kind to one or more Proceeds Divisions. The one ormore MSVP Sub-Divisions may be closed after the transfer of the assetsto the one or more Proceeds Divisions. The investment guidelines of theone or more Proceeds Divisions may be identical, or similar, to theinvestment guidelines of the MSVP Sub-Divisions from which the assetswere transferred.

The initial Investment Value of the one or more Proceeds Divisions willequal the sum of the Investment Value held in the one or more MSVPSub-Divisions. The Investment Value will grow at the crediting rate asdescribed above and the subsequent Investment Value of the one or moreProceeds Divisions will be computed as described below. In an alternateembodiment, the Investment Value will grow at a crediting rate aftersurrender that is determined in a manner that is different than thecrediting rate determination process prior to surrender, and thesubsequent Investment Value of the Proceeds Division will be computedbased on the post-surrender crediting rate. In an alternate embodiment,the initial Investment Value of the one or more Proceeds Divisions willbe adjusted and will not equal the sum of the Investment Value held inthe one orore MSVP Sub-Divisions

The Investment Value of a Proceeds Division is based on a valuecalculated by the MSVP Writer or insurance company under the terms ofthe MSVP. The Investment Value of a Proceeds Division will be equal tothe Investment Value as of the prior Valuation Day plus increases (A)minus subtractions (B). The increases (A) may include the amount of (A1)interest credited, which is calculated using a daily crediting rate asdetermined periodically by the MSVP Writer or the insurance company, forthe current valuation period, (A2) any Expense Credit or ExperienceCredit or additions from another source as discussed below and (A3) anyreallocations to the Proceeds Division. Interest may not be credited forany February 29^(th). The subtractions (B) may include the amount of(B1) Policy fees and charges deducted from the Proceeds Division, whichmay include Account Management Fees, Investment Advisory Fees, and theMSVP Fees, (B2) the Investment Value of the Certificate of any Insuredfor whom a Death Benefit is paid and whose death occurred prior to theSurrender Effective Date and (B3) any reallocations from the ProceedsDivision.

The value of the MSVP held by a Proceeds Division is the differencebetween (i) the Investment Value of the Proceeds Division and (ii) thevalue of the portfolio of securities and other investment instrumentsheld by the Proceeds Division.

The MSVP moderates fluctuations in the market value of the portfolio ofsecurities and other investment instruments held by the ProceedsDivision. In general, the crediting rates set by the MSVP Writer areapplied such that: for a Proceeds Division, it will over a period oftime, cause the MSVP value to be amortized and approach a value of zeroor a negative number.

Within ‘n’ months (e.g., six months or some other period of preferablyless than one year) of the date that the value of the MSVP in the one ormore Proceeds Divisions is equal to or less than a predetermined value(e.g., zero), the insurance company will liquidate the Proceeds Divisionand the contractholder will be paid the Investment Value of the ProceedsDivision in satisfaction of the ISPP Option and the MSVP will terminate.In another alternative, the insurance company may liquidate all or aportion of the Proceeds Division prior to the date that the value of theMSVP in the Proceeds Division is equal to or less than a predeterminedvalue (e.g., zero).

These conditions are designed to amortize the value of the MSVP. Theearnings or income on the investments of the one or more ProceedsDivisions will reduce the obligations of the MSVP Writer. The date bywhich the one or more Proceeds Divisions will be liquidated will bebased upon a variety of factors, including but not limited to: (i) thevalue of the MSVP, (ii) the market interest rate environment, (iii) theamount of earnings and income earned on the investments of the one ormore Proceeds Divisions, (iv) the crediting rate.

In another embodiment, the ISPP option may provide that the InvestmentValue of the one or more Proceeds Division (and/or an ISPP Trust MSVPDivision, described in more detail below) will be paid to thecontractholder after a period of time (e.g, “n” years after theSurrender Effective Date) has expired (generically referred to as the“ISPP Maturity Date” but such reference is not limited to any specificembodiment) regardless of whether the value of the MSVP in the ProceedsDivision (and/or the ISPP Trust MSVP Division) is equal to or less thana predetermined value (e.g., zero) at, or at any time before, the ISPPMaturity Date. The MSVP Writer may be responsible for all or a portionof any MSVP value that exists as of the ISPP Maturity Date.

In another alternative, the MSVP Writer may be responsible for paying anamount of MSVP value, which may be a portion of the MSVP value, and suchamount will not be amortized or reduced by the crediting rate process orother methods. Such amount may be determined by agreement, by events orconditions that occur prior to or as of the Surrender Effective Date, orby events or conditions that occur after the Surrender Effective Date.One example of an event that may occur is default or loss with respectto assets in a Proceeds Division, an MSVP Sub-Division, and/or a ISPPTrust MSVP Division. In another alternative, the ISPP Option may providethat the Investment Value of the one or more Proceeds Divisions (and/orthe ISPP Trust MSVP Divisions) will be paid to the contractholder within‘n’ months (e.g., six months or some other period of preferably lessthan one year) of the date that the value of the MSVP in the ProceedsDivision (and/or the ISPP Trust MSVP Division) is equal to or less thana predetermined value (e.g., zero) but the calculation of the value ofthe MSVP shall not take into account any amount of the MSVP value forwhich the MSVP Writer is responsible. In another alternative, the amountof the MSVP value for which the MSVP Writer is responsible may beamortized through the crediting rate process or another process so thatthe amount of the MSVP value for which the MSVP Writer is responsiblecan be reduced or eliminated on or before the ISPP Maturity Date.

In an alternate embodiment Expense Credits and Experience Credits (oradditions to the one or more Proceeds Divisions from another source)that occur during the operation of the ISPP Option may be utilized (asoffset values) to reduce the value of the MSVP. This will be achieved byincreasing the market value of the one or more Proceeds Division by anamount equal to the offset value (i.e., Experience Credit, ExpenseCredit or other source). The system may increase the book value of theone or more Proceeds Divisions in an amount less than or equal to theoffset value or not at all. This market/book allocation process mayrepresent a value agreed upon by the MSVP Writer and the contractholder,may be specified in the MSVP Division or Sub-Division or ProceedsDivision or may be selected in the MSVP Writer's discretion. Thismarket/book allocation process for one allocation source, (e.g., anExperience Credit) may or may not be the same as the establishedallocation process for any other allocation source (e.g., ExpenseCredit). The MSVP Writer can be supplied with sufficient details totrack this market/book allocation process (e.g., using a printedstatement, an email notification or an update on a web site).

The another source may include, but is not limited to, all or a portionof the Policy fees and charges deducted from the one or more ProceedsDivisions, which may include Account Management Fees, InvestmentAdvisory Fees, and the MSVP Fees, or may be contributions made by theMSVP Writer, the insurance company or the contractholder or may be allor a portion of the Mortality Reserve or earnings on amounts held in theMortality Reserve.

In another alternative, the Expense Credits, Experience Credits oranother source may be held in escrow or trust. The amount held in escrowor trust may be pledged for payment, if any, of an MSVP value thatexists as of the ISPP Maturity Date or may be used to reduce an MSVPvalue prior to the ISPP Maturity Date. The amount held in escrow ortrust may be used to support a guarantee by a third party of payment, ifany, of an MSVP value that exists as of the ISPP Maturity Date.

In another embodiment, the system performs an analysis to determine aprobability that the MSVP Product value for a policy or for one or moreMSVP Sub-Divisions (or Proceeds Divisions) will be equal to or less thana predetermined value (e.g., zero) prior to a period of time (e.g, “n”years) after the assumed Surrender Effective Date if a surrender were tooccur on a specified date and the ISPP Option procedures were utilized.The MSVP Product value may be the value that exists as of the date thatthe analysis is performed or an assumed MSVP Product value.

The system inputs projected performance data for assets held in a MSVPSub-Division, Corresponding Division or Proceeds Division, ahypothetical portfolio of assets or a financial index. The projectedperformance data may be received from a third party. In anotheralternative, the system generates the projected performance data.

The performance data may consist of “n” (e.g., 10,000) projectedscenarios for the performance of the assets over a period of time (e.g.,25 years). The number “n” should be large enough to provide astatistically significant number of scenarios.

The system will utilize the projected performance data to generate “n”(e.g., 10,000) projected scenarios and predict an MSVP Product value forone or more MSVP Sub-Divisions, Corresponding Divisions or ProceedsDivisions, or the policy, for specified future times (e.g., daily,monthly, quarterly, annually).

In another alternative, the system will generate the “n” (e.g., 10,000)projected scenarios and predict an MSVP Product value for one or moreMSVP Sub-Divisions, Corresponding Divisions or Proceeds Divisions, orthe policy for specified future times (e.g., daily, monthly, quarterly,annually) by utilizing an assumption that one or more of ExpenseCredits, Experience Credits or another source (e.g., all or a portion ofthe Policy fees and charges deducted from the Proceeds Division, whichmay include Account Management Fees, Investment Advisory Fees and MSVPFees) may be utilized to reduce the value of the MSVP prior to a periodof time (e.g, “n” years) after the assumed Surrender Effective Date.

In another alternative, the system will generate an analysis ofcalculation of capital required to meet expected liabilities of the MSVPWriter based on the “n” projected scenarios of MSVP Product value. Theanalysis may utilize an average (or other statistical methodology, e.g.,standard deviation, percentile ranking, number of standard deviationsfrom the mean) of the MSVP Product values predicted for all or a portionof the “n” projected scenarios. The portion of the “n” projectedscenarios may include the projected scenarios that produce a positiveMSVP Product value after the expiration of a period of time (e.g, “n”years) after the assumed Surrender Effective Date. The analysis mayutilize various combinations of the alternatives described above.

In other alternatives, the Investment Value held in the various MSVPSub-Divisions may: (1) be transferred from those MSVP Sub-Divisions toan ISPP Trust through the orderly liquidation of the underlyingsecurities and instruments held by the respective CorrespondingDivisions, or (2) not be transferred but maintained in the same MSVPSub-Divisions. In general, those assets, regardless of where they areheld, are referred to generically as “ISPP assets” but such reference isnot limited to any specific embodiment. In an embodiment utilizing anISPP Trust, (a) the ISPP Trust will hold all ISPP assets in trust forthe benefit of the contractholder and (b) the policy will no longer haveany investment or interest in the separate account established by theinsurance company other than rights existing under the MSVP Agreementwith the MSVP Writer.

The ISPP assets will grow at a post-termination crediting rate (e.g., acrediting rate determined in the same manner as the crediting rate isdetermined under the MSVP Sub-Divisions, or a credit rate specific tothe post-termination time period). The ISPP assets may be invested bythe contractholder utilizing options offered for the ISPP assets (e.g.,using the same type of investments as were available pre-termination).Should an ISPP Trust be used, each ISPP Trust MSVP division combines aninvestment in (a) an ISPP Trust Corresponding Division and (b) an MSVPvalue. The ISPP Trust MSVP division may pay fees from the assets of thedivision, which may include an investment management fee payable to theInvestment Manager of the division selected by the contractholder, anMSVP Fee payable to the MSVP Writer, and an Account Management Fee.

When the value of the ISPP Trust MSVP is equal to or less than apredetermined value (e.g., zero, i.e., the value of the ISPP Trust MSVPdivision is equal to the value of the ISPP Trust CorrespondingDivision), the MSVP Writer shall pay to the contractholder an amountequal to the value of the ISPP Trust MSVP division. Upon such payment,the MSVP Writer shall have no further liability under the MSVP or theISPP Trust MSVP.

The contractholder may have an option to elect at any time to receive apayment amount from one or more Proceeds Divisions or the ISPP Trustequal to the value of the one or more Corresponding Divisions or ISPPTrust Corresponding Divisions. In such event, the MSVP Writer may haveno further liability or a reduced liability under the MSVP or the ISPPTrust MSVP.

If the contractholder does not elect the ISPP Option, upon surrender:(i) the value of the MSVP automatically becomes zero, (ii) the MSVPterminates; (iii) the contractholder will receive only the liquidationvalue of the interest in the one or more Corresponding Divisions held bythe one or more MSVP Sub-Divisions. In another alternative, if thecontractholder does not elect the ISPP option, upon surrender the valueof the MSVP will be reduced to a value greater than zero and the MSVPwill not terminate.

The contractholder may have an option to receive any amounts remainingin the Mortality Reserve. The contractholder may be required to delivera waiver of incurred but not yet paid Death Benefits to the insurancecompany in order to receive such amounts.

In one embodiment, the contractholder only receives the value of theMSVP if the contractholder requests funds from the Policy by exercisingits right to request a Maximum Withdrawal (as described in theco-pending U.S. Application No. 61/623,389, filed Apr. 12, 2012incorporated by reference) or if the contractholder surrenders thePolicy under the ISPP Option. In alternative embodiments, only one ofthe Maximum Withdrawal features or the ISPP Option will be available,but not all. Various combinations of the Maximum Withdrawal features andthe ISPP Option can also be provided in alternative embodiments.

The term “Investment Value,” as used herein, refers to the value of theassets of the Divisions in the separate account of the policy or thevalue of assets allocated under the policy to the general account of theinsurance company (as described below). Thus, for example, in aCorresponding Division, the Investment Value is based on the marketvalue of the portfolio of assets in the Corresponding Division, in aMSVP Sub-Division, the Investment Value is based on the value of theMSVP (and SVP if applicable) and the market value of the portfolio ofassets held by the Division, or portion thereof, credited to the MSVPSub-Division, and in a Proceeds Division the Investment Value is basedon the value of the MSVP (and SVP if applicable) and the market value ofthe portfolio of assets held by the Proceeds Division.

The terms MSVP Product and MSVP are used interchangeably herein and havethe same meaning.

While an ISPP Option is in effect, the MSVP Writer or the insurancecompany may have the right to take certain actions to amortize the valueof the MSVP Product upon the occurrence of certain events or conditions,referred to as Transition Triggers above. These actions may includereallocating all of a portion of a Proceeds Division to a low risk orlow volatility investment (e.g., a money market or short term governmentbond Division), resetting the crediting rate (e.g., to not less than 0%or 0.1%), and/or changing the amortization period (which may be subjectto a maximum period of years). For certain events or conditions, thecontractholder may also have the right to take certain actions, e.g.,reallocate all or a portion of a Proceeds Division to a low risk or lowvolatility investment (e.g., a money market or short term governmentbond Division). The system tracks these events or conditions andprovides reports or notices to various parties including the MSVPWriter, the insurance company and the contractholder.

Examplary Transition Triggers with respect to Proceeds Divisionsinclude, but are not limited to: (a) the book value of the ProceedsDivision falls below a specified amount, (b) the value of an MSVPProduct for a Proceeds Division equals or exceeds a specifiedpercentage, (c) an Investment Adviser ceases for any reason to act as aninvestment manager for a Proceeds Division, unless the insurance companyappoints another investment manager for the Proceeds Division and theMSVP Writer consents in writing not to treat the change of investmentmanagers as a condition or event for which it would have the right totake certain actions described above, (d) a measurement designed totrack whether yields are increasing for the assets of the one or moreProceeds Divisions (e.g., the trailing 20 quarter average yield of theassets of the Proceeds Division (or an index) shows an increase inyields and (e) the average attained age of the Insureds under thePolicy, weighted by each Certificate's Variable Insurance Amount or faceamount, is greater than a specified age.

In an alternative embodiment, the assets of the life insurance policyare not held within a separate account and rather are allocated to andheld in the general account of the insurance company. A portion of theassets of the general account will be identified and tracked(generically referred to as “Identified Investments” but such referenceis not limited to any specific embodiment). The Identified Investmentsmay be subject to investment guidelines. The investment guidelines andthe Identified Investments may be subject to change or may remain thesame for the duration of the period that the assets are allocated to thegeneral account. The value of the Identified Investments may be equal tothe value of the assets allocated to the general account or the twovalues may be different. In other alternatives, the IdentifiedInvestments may be all assets of the general account and the IdentifiedInvestments may differ for different purposes (e.g. setting thecrediting rate and determining when a payment will be made to acontractholder).

When assets of the life insurance policy are allocated to the generalaccount, an Investment Value for such assets will be determined (“bookvalue”). The Investment Value for the assets allocated to the generalaccount will grow at a crediting rate. The crediting rate for the assetsheld in the general account is determined at the time that policy assetsare allocated to the general account. The crediting rate will not changefor the duration of the time period that assets are held in the generalaccount. Alternatively, the insurance company (or an MSVP Writer) maydetermine adjustments to the crediting rate for the assets held in thegeneral account from time to time. The adjustments may be determined inthe discretion of the insurance company (or an MSVP Writer). In anotheralternative, the adjustments to the crediting rate may be based uponidentified criteria. Such criteria may include the past or anticipatedperformance of Identified Investments or an index, including a financialperformance index. The crediting rate may be used to amortizedifferences between the value of the Identified Investments and theInvestment Value of the assets allocated to the general account.Crediting rate formulas similar to those described herein may beutilized.

Fees and charges incurred under the policy or during an ISPP Option maybe deducted from the value of the Identified Investments and/or from theInvestment Value of the assets allocated to the general account. Suchfees and charges may include: (1) an investment management fee payableto the Investment Manager of the Identified Investments; and (2) an MSVPFee payable to the MSVP Writer, if any. In another alternative, otherfees may be paid and different methods for accrual and times for paymentmay be utilized.

In the event of a surrender of the policy, an ISPP Option may beutilized. A contractholder can elect or be provided an ISPP Option whenthe contractholder terminates the life insurance coverage via surrender.The contractholder may also elect or be provided an ISPP Option at thetime of allocation to the general account or at other times. The ISPPOption operates as described below. The insurance coverage willterminate on the Surrender Effective Date. Accordingly, no Death Benefitis payable for any death occurring on or after the Surrender EffectiveDate. In an alternative embodiment, the contractholder provides a noticeof surrender but the termination of insurance coverage does not occuruntil the value of the Identified Investments is greater than or equalto the Investment Value of the assets allocated to the general account.

Under the ISPP Option the following procedures, terms and conditionswill apply. Following the Surrender Effective Date, the insurancecompany will liquidate the Identified Investments in the general accountwithin “n” months of the Surrender Effective Date. In an alternativeembodiment, the insurance company may estimate the liquidation value ofthe Identified Investments.

In an alternative embodiment, the Identified Investments will beliquidated and the proceeds thereof will be allocated to a separateaccount. In another alternative, the Identified Investments will betransferred in kind to a separate account. In such events, the ISPPOption procedures described above for a separate account may beutilized.

As used herein, the difference between the Investment Value of theassets allocated to the general account and the value of the IdentifiedInvestments is generically referred to as “GA Difference” but suchreference is not limited to any specific embodiment.

If the GA Difference is equal to or less than a predetermined value(e.g., zero), the Investment Value is paid to the contractholder within“n” months (e.g., six) of the Surrender Effective Date. If the GADifference is greater than a predetermined value (e.g., zero), theInvestment Value will be paid to the contractholder within “n” months ofthe date that the GA Difference is equal to or less than a predeterminedvalue (e.g., zero).

In another embodiment, the ISPP Option may provide that the InvestmentValue of the assets allocated to the general account will be paid to thecontractholder after a period of time (e.g, “n” years after theSurrender Effective Date) has expired (generically referred to as the“ISPP Maturity Date” but such reference is not limited to any specificembodiment) regardless of whether the GA Difference is equal to or lessthan a predetermined value (e.g., zero) at, or at any time before, theISPP Maturity Date. The insurance company (or an MSVP Writer) may beresponsible for all or a portion of any GA Difference that exists as ofthe ISPP Maturity Date.

In another alternative, the insurance company (or an MSVP Writer) may beresponsible for paying an amount of GA Difference, which may be aportion of the GA Difference, that exists as of the ISPP Maturity Dateand such amount will not be amortized or reduced by the crediting rateprocess or other methods. Such amount may be determined by agreement, byevents or conditions that occur prior to or as of the SurrenderEffective Date, or by events or conditions that occur after theSurrender Effective Date. One example of an event that may occur isdefault or loss with respect to Identified Investments. In anotheralternative, the ISPP Option may provide that the Investment Value ofthe assets allocated to the general account will be paid to thecontractholder within ‘n’ months (e.g., six months or some other periodof preferably less than one year) of the date that GA Difference isequal to or less than a predetermined value (e.g., zero) but thecalculation of the GA Difference shall not take into account any amountof the GA Difference for which the insurance company (or MSVP Writer) isresponsible. In another alternative, the amount of the GA Difference forwhich the insurance company (or MSVP Writer) is responsible may beamortized through the crediting rate process or another process so thatthe amount of the GA Difference for which the insurance company (or MSVPWriter) is responsible is reduced or eliminated on or before the ISPPMaturity Date.

In an alternate embodiment Expense Credits and Experience Credits (oradditional allocations to the general account from another source) thatoccur prior to or during the operation of the ISPP Option may beutilized (as offset values) to reduce the value of the GA Difference.

This will be achieved by increasing the market value of the IdentifiedInvestments by an amount equal to offset values. The system may increasethe book value of the assets allocated to the general account in anamount less than or equal to the offset values or not at all. Thismarket/book allocation process may represent a value agreed upon by theinsurance company (or MSVP Writer) and the contractholder, or may beselected in the insurance company's (or MSVP Writer's) discretion. Thismarket/book allocation process for one allocation source, (e.g., anExperience Credit) may or may not be the same as the establishedallocation process for any other allocation source (e.g., ExpenseCredit). The MSVP Writer can be supplied with sufficient details totrack this market/book allocation process (e.g., using a printedstatement, an email notification or an update on a web site).

The another source may include, but is not limited to, Policy fees andcharges incurred during a specified period of time (e.g., after theSurrender Effective Date) or may be contributions made by the insurancecompany (or MSVP Writer) or the contractholder or may be all or aportion of the Mortality Reserve or earnings on amounts held in theMortality Reserve.

The crediting rate for the assets allocated to the general account willbe determined in the same manner after the Surrender Effective Date asthe crediting rate was determined prior to the Surrender Effective Date.In an alternate embodiment, the crediting rate for the assets allocatedto the general account will be determined in a manner that is differentthan the crediting rate determination process prior to surrender.

The contractholder may have an option to elect at any time to receive apayment amount from the insurance company equal to the value of theIdentified Investments. In such event, the insurance company (or MSVPWriter) may have no further liability or a reduced liability under thepolicy (or MSVP).

If the contractholder does not elect the ISPP option, upon surrender:(i) the contractholder will receive only the liquidation value ofIdentified Investments, (ii) the value of the MSVP, if any,automatically becomes zero and (iii) the MSVP, if any, terminates. Inanother alternative, if the contractholder does not elect the ISPPoption, upon surrender the value of the MSVP will be reduced to a valuegreater than zero and the MSVP will not terminate.

While certain configurations of structures have been illustrated for thepurposes of presenting the basic structures of the present invention,one of ordinary skill in the art will appreciate that other variationsare possible which would still fall within the scope of the appendedclaims.

We claim:
 1. A computer system for administering an investmentcomprising: at least one computer processor; at least one memory forstoring computer executable instructions, wherein execution of thecomputer executable instructions by the at least one computer processorcauses the computer system to perform: tracking an investment value ofat least one stable value protected investment utilizing a surrenderpayment protocol option; tracking an asset value of at least oneunderlying asset associated with the at least one stable value protectedinvestment; receiving a termination indication that a contract holder ofa life insurance contract including the at least one stable valueprotected investment has requested termination of the life insurancecontract; determining a difference representing an extent to which theinvestment value exceeds the asset value; and providing a paymentindication that the contract holder be paid an amount based on theinvestment value when the difference is at most a first predeterminedthreshold value.
 2. The computer system as claimed in claim 1, whereinthe computer executable instructions for causing the computer system toperform providing the payment indication comprises computer executableinstructions for causing the computer system to perform providing thepayment indication if the difference is at most the first predeterminedthreshold value in a first timeframe.
 3. The computer system as claimedin claim 2, wherein the computer executable instructions for causing thecomputer system to perform providing the payment indication comprisescomputer executable instructions for causing the computer system toperform providing the payment indication in a second timeframe if thedifference is more than the first predetermined threshold value in thefirst timeframe.
 4. The computer system as claimed in claim 1, whereinthe computer executable instructions for causing the computer system toperform determining the difference further comprises computer executableinstructions for causing the computer system to perform requestingliquidation of the at least one underlying asset associated with the atleast one stable value protected investment.
 5. The computer system asclaimed in claim 1, wherein the computer executable instructions forcausing the computer system to perform determining the differencefurther comprises computer executable instructions for causing thecomputer system to perform determining an estimated value of the atleast one underlying asset associated with the at least one stable valueprotected investment.
 6. The computer system as claimed in claim 1,wherein the computer executable instructions for causing the computersystem to perform determining the difference further comprises computerexecutable instructions for causing the computer system to calculate anactual value of the at least one underlying asset associated with the atleast one stable value protected investment.
 7. The computer system asclaimed in claim 1, wherein the computer executable instructions forcausing the computer system to perform tracking the asset value of atleast one underlying asset associated with the at least one stable valueprotected investment and tracking the investment value of at least onestable value protected investment utilizing the surrender paymentprotocol option further comprises computer executable instructions forcausing the computer system to perform: determining a value of at leastone payout corresponding to at least one insured for whom a deathbenefit is paid and whose death occurred prior to a date the lifeinsurance contract was terminated; and deducting from the asset valuethe value of the at least one payout; and deducting from the investmentvalue the value of the at least one payout.
 8. The computer system asclaimed in claim 1, wherein the computer executable instructions forcausing the computer system to perform determining the differencefurther comprises computer executable instructions for causing thecomputer system to perform calculating an offset value corresponding toat least one of experience credits and expense credits.
 9. The computersystem as claimed in claim 1, wherein the computer executableinstructions for causing the computer system to perform determining thedifference further comprises computer executable instructions forcausing the computer system to perform calculating an offset valuecorresponding to at least one of (1) fees collected from the lifeinsurance policy, (2) contributions by an entity, (3) at least a portionof a Mortality Reserve and (4) at least a portion of earnings on amountsheld in the Mortality Reserve.
 10. The computer system as claimed inclaim 9, wherein the entity comprises at least one of a Stable ValueProduct (SVP) writer, a Modified Stable Value Product (MSVP) writer andan insurance company.
 11. The computer system as claimed in claim 8,wherein the computer executable instructions for causing the computersystem to perform determining the difference further comprises computerexecutable instructions for causing the computer system to performdetermining if a difference between (a) the difference between theinvestment value and the asset value and (b) the offset value is at mosta second threshold value.
 12. The computer system as claimed in claim11, wherein the computer executable instructions for causing thecomputer system to perform determining the difference further comprisescomputer executable instructions for causing the computer system toperform: instructing that the offset value be held in at least one of anescrow and a trust; and instructing that the offset value be utilized asa payment to reduce the difference between the investment value and theasset value.
 13. The computer system as claimed in claim 9, wherein thecomputer executable instructions for causing the computer system toperform determining the difference further comprises computer executableinstructions for causing the computer system to perform determining if adifference between (a) the difference between the investment value andthe asset value and (b) the offset value is at most a second thresholdvalue.
 14. The computer system as claimed in claim 13, wherein thecomputer executable instructions for causing the computer system toperform determining the difference further comprises computer executableinstructions for causing the computer system to perform: instructingthat the offset value be held in at least one of an escrow and a trust;and instructing that the offset value be utilized as a payment to reducethe difference between the investment value and the asset value.
 15. Thecomputer system as claimed in claim 8, wherein the computer executableinstructions for causing the computer system to perform tracking theasset value of at least one underlying asset associated with the atleast one stable value protected investment and tracking the investmentvalue of at least one stable value protected investment utilizing thesurrender payment protocol option further comprises computer executableinstructions for causing the computer system to perform adding theoffset value to the asset value without adding an entire amount of theoffset value to the investment value.
 16. The computer system as claimedin claim 9, wherein the computer executable instructions for causing thecomputer system to perform tracking the asset value of at least oneunderlying asset associated with the at least one stable value protectedinvestment and tracking the investment value of at least one stablevalue protected investment utilizing the surrender payment protocoloption further comprises computer executable instructions for causingthe computer system to perform adding the offset value to the assetvalue without adding an entire amount of the offset value to theinvestment value.
 17. The computer system as claimed in claim 1, whereinthe computer executable instructions for causing the computer system toperform tracking the asset value of at least one underlying assetassociated with the at least one stable value protected investment andtracking the investment value of at least one stable value protectedinvestment utilizing the surrender payment protocol option furthercomprises computer executable instructions for causing the computersystem to perform tracking a portion of the investment value of the atleast one stable value protected investment that is not to be eitheramortized or reduced by a crediting rate.
 18. The computer system asclaimed in claim 17, wherein the portion corresponds to a portion of theunderlying asset value for which at least one of a predetermined eventand a predetermined condition occurred after the contract holderrequested termination of the life insurance contract.
 19. The computersystem as claimed in claim 18, wherein the at least one of apredetermined event and a predetermined condition comprises at least oneof a default and a loss.
 20. The computer system as claimed in claim 1,wherein the at least one underlying asset associated with the at leastone stable value protected investment is held in a separate account onbehalf of the contract holder.